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> Spotify's problem is it has to pay out ~80% of revenue to rightsholders, so Apple's 15% take doesn't leave you with a viable business. It's the 80% of revenu
by josefresco 3y ago
> Spotify's problem is it has to pay out ~80% of revenue to rightsholders, so Apple's 15% take doesn't leave you with a viable business.
It's the 80% of revenue to rightsholders that makes it a non-viable business.
- bryanlarsen 3y ago20% of a very large number is still a large number. There are lots of very profitable businesses that have a ~1% profit margin.
- xboxnolifes 3y ago80% of a very large number is an even larger number.
- andrewmcwatters 3y agoCostco is famously about 2% or so, which is basically the entirety of their membership fee revenue, iirc.
- dessimus 3y agoThat doesn't mean 20% is their profit. It means all the rest of their overhead has fit into that 20%, such as hosting infrastructure, office space, labor, marketing, etc.
- bryanlarsen 3y agoOh no, how will they cover overhead with 20% of tens of billions of dollars!?
- pjerem 3y agoIt’s not like they have any control over this. What should they do ? Yeah they could say fuck-off to Universal & Co but it would be their instant death. Right holders made them sign extremely strict contracts which disallow Spotify to diversify themselves. Notoriously, their contracts with majors states that they are forbidden to develop their own in-house label.